Economics Dictionary of ArgumentsHome
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| Capitalism: Capitalism is an economic system where private individuals or businesses own and operate the means of production for profit. It is characterized by competition, markets, and a focus on individual wealth accumulation._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Karl Marx on Capitalism - Dictionary of Arguments
Rothbard II 422 Capitalism/Marx/Rothbard: The vital corollary for the Marxian system, of the ever-thinning ranks of the centralized capitalists, is the ever-swelling ranks of the proletariat, and their increasing impoverishment and immiseration. >History/Marx. Rothbard II 423 RothbardVsMarx: Now here is a critical and crucial point in the Marxian argument. The increasing impoverishment of the working class is a key to the Marxian system, because on it rests the allegedly inevitable doom of capitalism and its replacement by the proletariat. If there is no increasing impoverishment, there is no reason for the working class to react against their intensifying exploitation and burst asunder their 'capitalist integument', those fetters on the technological mode of production. So how does Marx demonstrate the increasing poverty of the proletariat? At this point, Marx seems to grow desperate, and to come up With a number of varied and contrasting arguments, some ofwhich are mutually contradictory. For if workers' wages are already and at all times at the means of subsistence, kept there by the iron law, how can they get any worse off! >Wages/Marx, >Rate of profit/Marx. RothbardVsMarx: Setting aside for the moment this grave inner contradiction with the iron law of wages, how does Marx propose to establish his alleged law of the increasing Rothbard II 424 impoverishment of the proletariat? In one answer, the eternally falling rate of profits puts a severe pressure on capitalists to find more profit by sweating and exploiting the proletariat more intensively, making them work harder and for longer hours. But aside from the problem of the ever-present iron law, Marx is faced With the problem: Why did capitalists allow their rate of exploitation to grow slack until finally spurred on by a falling rate of profit? Don't capitalists always and at all times try to maximize their rates of profit? Solution/Marx/Rothbard: Here Marx falls back on a suggested mechanism for this increased exploitation of labour and falling wage rate: the accelerating growth of a permanent 'industrial reserve army', a growing legion of the unemployed. It is increased competition from the unemployed that forces wage rates downwards, and increasingly continues to do so as capitalism advances. RothbardVsMarx: But how can there be a continuing army of the unemployed, when wages to the unemployed are zero? Reserve army: Also, where does the industrial reserve army come from? Market economists know that unemployment quickly eliminates itselfby Iowering wage rates. Only if wage rates are bolstered above the market equilibrium level does unemployment become permanent; and if, as Marx maintains, the unemployed army Iowers wage rates through its competition, then it should rapidly disappear and pose no further problems. >Unemployment/Marx. Rothbard II 426 Impoverishment of the proletariat/Marx/Rothbard: We are left with the doctrine of the growing impoverishment of the proletariat, a doctrine so crucial in Marx that it can hardly be trivialized as a 'prediction' that somehow went astray. This 'prediction' is absolutely critical to the allegedly inevitable tendency for the workers to rise up and overthrow capitalism, a tendency that is supposed to deepen and accelerate as capitalism progresses. And yet, it has been starkly evident to everyone that one of the vitally significant facts of the century and a half since the birth of Marxism has been the continuing, spectacular growth in real wages and in the standard ofliving of the working class and of the mass of the population. Indeed what we have seen in this period is the most spectacular growth in industrialization and in living standards in the history of the world. MarxismVsVs: (…) generally, Marxists have tried to save the phenomenon, salvage the theory, by various fallback positions or forms of evasion. One popular tactic asserts that the underlying tendency toward impoverishment still exists, but has been 'temporarily' (one or two centuries?) offset by counteracting factors. A popular but bizarre Leninist variant is that workers in the West have benefited from imperialist western exploitation of, or investment in, the Third World, so that in a sense, western workers become 'capitalists' on an international scale. In the first place, in this transmutation of the oppressed proletariat of the West into exploiting 'capitalists' of the Third World, what ever happened to the inevitable dwindling of the capitalist class? Second, the grotesquerie of this doctrine may be gauged by the fact, as P.T. Bauer has demonstrated in many works, that the bulk of the Third World, however poor, has also been developing rapidly in recent decades, and the standard of living of their working masses has steadily risen. Not only that; but this development and rise in standards has taken place precisely in those areas and regions of the Third World (e.g. port cities) in closest trading and investment touch with developed western countries._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Marx I Karl Marx Das Kapital, Kritik der politische Ökonomie Berlin 1957 Rothbard II Murray N. Rothbard Classical Economics. An Austrian Perspective on the History of Economic Thought. Cheltenham, UK: Edward Elgar Publishing. Cheltenham 1995 Rothbard III Murray N. Rothbard Man, Economy and State with Power and Market. Study Edition Auburn, Alabama 1962, 1970, 2009 Rothbard IV Murray N. Rothbard The Essential von Mises Auburn, Alabama 1988 Rothbard V Murray N. Rothbard Power and Market: Government and the Economy Kansas City 1977 |
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> Counter arguments against Marx
> Counter arguments in relation to Capitalism
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